One of the few remaining dealer-owned companies in the Fleet News Top 50, Hartwell Motor Contracts, has sold 5,500 of its 8,000-strong fleet to debis Car Fleet Management UK for an undisclosed sum.
Edward McCabe, group managing director of dealer and property group Hartwell, said the emergence of a contract hire superleague meant his firm could not compete against the economies of scale of the bigger players: 'We are pulling out of the corporate contract hire business and will instead be concentrating on brokerage, personal leasing and fleets of just a few vehicles.
'The vehicles we have sold to debis are the ones that carry a residual value risk for us. The industry seems to be dominated by the bank and manufacturer-owned big players. The fall in residual values has hit us like everyone else, but the driving factor in our decision was that we just could not compete with the economies of scale and access to funds the larger players have.'
Debis managing director Geoff Robinson says the purchase, which takes its fleet to more than 25,000 vehicles, is just the first step in a multi-million pound acquisition and organic expansion programme to take on the top six firms - Lex Vehicle Leasing, GE Capital Fleet Services, Lease Plan/Dial, First National Vehicle Holdings, Interleasing, and PHH/Arval. Debis intends to have a fleet of more than 60,000 vehicles within two years, heralding more consolidation for the industry.
The deal will see Hartwell hand over the vast majority of its customer base, but keep the Hartwell Motor Contracts brand. Both firms refused to comment on whether Ian Hill, general manager of Hartwell, would be playing a role.
The debis deal is part of a Europe-wide expansion plan for the DaimlerChrysler subsidiary that will give the company coverage in 17 countries in two years, compared to nine currently. The purchase is the latest in a record-breaking run of acquisitions in the contract hire industry that include the purchase of Highway Vehicle Management by First National Vehicle Holdings.